In the corporate sector there are a number of companies that are controlled by particular families. Among these, almost 80% are managed by the founders of the companies. But indications of change of ownership in these businesses are there and so the family business ownership is becoming vital.
The family business ownership is becoming an important factor for all the businesses that are controlled by particular families. The business-owner families as well as the professional advisors are thinking deeply about the family business ownership succession strategies and planning.The family business ownership planning is becoming such important because of certain reasons.
There are more than 40% of the family businesses where the ownership change is expected in 2008. At the same time, nearly 50% such businesses will find new leaders till 2013.
Majority of the family business owners are expecting that the ownership of their businesses will be in their hands but according to the available data, this will not be easy. The data show that the rate of family business survival in the second and third generation is very low.
An appropriate family business succession planning can help the business owner families in maintaining their ownership. A number of factors are very important for proper family business ownership planning.
Some of these factors are the following:
1. The documents of family business ownership planning should express clearly about the planning regarding the transfer of ownership, division of assets and so on. The business ownership plan should be according to the circumstances. Regular review of these plans is very necessary
2. The junior members and all the stakeholders should also be consulted before making any plan. According to the traditional idea about these plans, the senior generation performs all the duties and the juniors are not involved. But in the changing circumstances, the juniors should be consulted